Scott Ford, Pepper IoT CEO | Tommy Felts/Startland News

Q&A: Pepper IoT’s Scott Ford on smart tech security, user growth, a big exit

Consumers of smart technology need to be wary of most of the lesser-known brands in retail stores, Scott Ford said.

“Most likely, they’re using a platform architecture that sits on a foreign market, sending your data to who knows where, without the protections that are common in the U.S,” said Ford, CEO of Pepper IoT, a Kansas City-based startup that makes an operating system and delivery platform for connected devices.

From a cybersecurity and privacy perspective, the marketplace is “a complete mess” for consumers and service providers, Ford said.

Pepper caters to global consumer electronics manufacturers, and is focused on creating platform security, privacy and scalability, he said.

The company is a portfolio company of Evergy Ventures, the investment arm of Kansas City-based utility Evergy (formerly Great Plains Energy).

Missouri Business Alert caught up with Ford at last week’s Startland News Innovation Exchange to discuss glitches and growth of the smart home tech industry and Pepper IoT’s role in the $15 billion market.

Missouri Business Alert: What led to the creation of Pepper IoT?

Scott Ford: We started the company as a network home automation provider in conjunction with Best Buy. We created a product that had a powered hub and devices that you’d buy in a starter kit and take home and put them up in your house and connect them to our platform. We decided to move away from that business model, because we learned that consumers in the IoT market today are buying one device at a time, not bundles of devices. So, we shifted our business model and created a more progressive, futuristic platform to enable IoT services. Now our customers are enterprises who want to launch and manage IoT services for their consumer users.

MBA: What’s the scope for the IoT and smart home tech markets? How far has the industry come and how do you think it’s going to grow in the future?

SF: It’s still very early on, but it has come a long way in terms of technology and what’s available to us to create high-utility experiences, but it’s very much on the front edge of growth. Today, most of us who run in these tech circles have five or six connected devices in our connected lifestyle. That’ll grow to something in the 20s in the next few years. What you need is a platform infrastructure and a software solution to be able to help you manage all of those devices in your life. So I think the growth is significant and it’s just the beginning years of IoT.

MBA: What is your startup’s approach to ensuring that your customers have cybersecurity and privacy? How do you address the balance between security and convenience?

SF: In the United States, when you’re talking about consumer-grade connected devices, it’s a complete mess right now, from a cybersecurity and privacy perspective. If you go into a retail location, there are big brands like LG or Samsung and you can be completely confident that they’re taking care of you from the cybersecurity and privacy perspective. That only represents maybe 20% of the devices. The 80% is where you have to worry with brands that you’re only vaguely familiar with or have never heard of before. Most likely, they’re using a platform architecture that sits on a foreign market, sending your data to who knows where without the protections that are common in the U.S. It’s a very big problem. Pepper is a solution to that problem. We work with manufacturers of these devices to allow them to use a highly secure, highly private environment to allow the communication between the devices and the consumers.

MBA: What is being done to make smart technology accessible to everyone?

SF: Home security has generally been unaffordable to the mass market, but with IoT and new technologies, it is going to be more affordable. Instead of paying a big security company up to $70 a month, you’ll be able to have the same level of central station monitored security for $5 or $10 a month.

MBA: What are some recent milestones for Pepper IoT?

SF: We just passed 700,000 users on our platform, which we’re proud of. We have devices that are powered by Pepper that are available in over 10,000 retail locations around the world. We have recently enabled our seventh language, Japanese, as a language for devices that are sold in Japan. We support eight currencies around the world. So we have a very global approach with devices everywhere. We’re beginning to onboard service providers, which are companies that have millions of customers and they want to create a branded experience. So they use our platform to do that. We just signed one — it’s not public yet, but we’re excited about that.

MBA: What is the biggest challenge that is going to be faced by the smart home technology industry and the IoT industry in the near future? And specifically, what challenges is Pepper facing now?

SF: The biggest limiter to growth is around security and privacy, which has to be solved or the general public is just going to be going to be worried about the communication and integrity of their devices. As a company, we are taking a bold move to make sure cybersecurity and privacy is at the center of everything we do. The industry is very unorganized right now, and (there’s) a lot of misunderstanding of what’s required to create really high-quality IoT experiences. So our challenge as a young startup entering this massive space is to make sure that the general market understands what Pepper is and what we bring to the marketplace. Slowly but surely, the industry is evolving and we’re getting a lot of inbound interest of people.

MBA: What does success look like for Pepper?

SF: Success for us, just to be blunt, is a multi-hundred million dollar exit (in) a couple of years. That’s really what we’re shooting for, and we expect that to be the case given where we sit in the market and the opportunity that’s coming toward us.


This story was produced through a collaboration between Missouri Business Alert and Startland News.